Australian College of Business Intelligence Procurement Plan Report

This document presents a Procurement Management Plan template designed for a City Cafe project, likely for the Australian College of Business Intelligence. It outlines key components of procurement, starting with an introduction and the procurement management approach. It defines procurement, discusses contract types (with a focus on fixed-price arrangements), and addresses procurement risks and their mitigation. The plan details cost determination methods, standardized procurement documentation, and procurement constraints. It also covers the contract approval process, decision criteria for vendor selection, and vendor management strategies. Furthermore, it includes performance metrics for procurement activities and concludes with sponsor acceptance. The plan emphasizes risk management, cost control, and the importance of a structured approach to procurement to ensure project success. The plan is a comprehensive guide for managing procurement processes within the city cafe project, ensuring alignment with stakeholder needs and market demands. The document is a valuable resource for students and professionals seeking to understand and implement effective procurement strategies. The plan is designed to ensure project progress, manage risks, and select vendors based on specific criteria.

Procurement
Management Plan
Template:
BSBPMG513 Manage project quality
Instructions: Write your name here
Procurement Management Plan Template: BSBPMG514 Version: v20.0 Page 1 of 8
Developed by: ACBI Approved by: DoS Issued: July 2019 Review: May 2020

Copyright 2020
 Australian College of Business Intelligence
All rights reserved
Version: 20.0
Date Modified: May 2020
No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means,
electronic, mechanical, photocopying, recording or otherwise without the prior written permission of Australian College of
Business Intelligence.
Disclaimer:
The Australian College of Business Intelligence does not invite reliance upon, nor accept responsibility for, the information it
provides. The Australian College of Business Intelligence makes every effort to provide a high-quality service. However,
neither the Australian College of Business Intelligence, nor the providers of data, gives any guarantees, undertakings or
warranties concerning the accuracy, completeness or up-to-date nature of the information provided. Users should confirm
information from another source if it is of sufficient importance for them to do so.
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Developed by: ACBI Approved by: DoS Issued: July 2019 Review: May 2020

Content
s
Procurement Management Plan Template..............................................................................4
1. Introduction.........................................................................................................................................4
2. Procurement Management Approach.................................................................................................4
3. Procurement definition.......................................................................................................................5
4. Type of contract to be used.................................................................................................................5
5. Procurement risks................................................................................................................................5
6. Procurement risk management...........................................................................................................6
7. Cost determination..............................................................................................................................6
8. Standardised procurement documentation........................................................................................7
9. Procurement constraints.....................................................................................................................7
10. Contract approval process.................................................................................................................7
11. Decision criteria.................................................................................................................................8
12. Vendor Management.........................................................................................................................8
13. Performance metrics for procurement activities...............................................................................8
14. Performance metrics for procurement activities...............................................................................9
15. Sponsor acceptance...........................................................................................................................9
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Developed by: ACBI Approved by: DoS Issued: July 2019 Review: May 2020

Procurement Management Plan
Template
Project Name: Date:
Project Manager: Author
Version History and
Changes:
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1. Introduction
The Procurement Planning Strategy is an important component of the Project Management Process.
The paper explains how products and services can be obtained during the process, as well as the
methodology that city café manager can use to handle the process vendors. The main purpose of this
plan is to make stakeholder aware about the innovation that is going to be done as per the customer
and market demand within café in the upcoming time.
2. Procurement Management Approach
The definition of structures has broad applicability. Structures have constraints but they still
communicate with the external world, i.e. open systems are organisations. It recognizes the value of
researching the interdependency in an organisation of planning, coordinating and managing and also
the various sub-systems.
3. Procurement definition
A Procurement Management Strategy helps identify city café innovation specifications and
efficiently coordinate the measures taken to meet the contract extension. The strategy should be able
to change as procurement requirements are updated, and discuss critical topics like what products
will have to be obtained, how agreements will be accepted, the parameters decision must be based
on, identified risks, cost estimation and contract performance monitoring, to name several.
4. Type of contract to be used
The fixed-price arrangement is a legal arrangement used within city café between the project
agreement as well as an individual (person or firm) to supply the project with products or services at
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Developed by: ACBI Approved by: DoS Issued: July 2019 Review: May 2020

an agreed-upon price. It's really the contractor that is responsible for overseeing the job to satisfy the
demands of the client. The project manager is tracking the production and coordinating performance
and progress the firms are fulfilling the project requirements. This typically covers the functions of the
plan cost management programme including specifications for e-signature, permissions and
compliance protocols for post-signature. The risks involved with fixed-price agreement are the
consequences of modifying the schedule. If a transition happens on a project causing the contractor
to transition order, the adjustment price is usually very high. Especially if the payment for
improvements is reflected in the initial contract, adjustments to a fixed-price contract can incur higher
project completion time than other kinds of insurance so much of the expense burden is passed to the
contractor, yet most suppliers will add a provision to the deal to offset any added risk.
5. Procurement risks
These threats may involve factors like disputes between the suppliers, unreasonable timelines,
idealistic expense estimates, possible delivery delays, and the failure of a vendor to reach deadlines
or deliver to requirements of city café.
6. Procurement risk management
The proposal will include a segment to minimise all of the known threats, in order to guarantee
project progress. For instance, if the specialist construction company fails to perform their phase of
the work, they can find a replacement contractor to contact. A segment name really should be in
effect and also has the power to authorise problems resolving measures regarding any hazards that
occur which are not explicitly defined.
7. Cost determination
In this phase it is necessary to describe precisely how to assess the costs involved with the city cafe
innovation project. A Request for Proposal (RFP) would be released for certain procurements,
detailing the requirements and requesting vendors to tender. They will explain in their answers what
items or services they will offer, manager might conduct the job, their expertise of supplying the
kinds of services or goods, plans and a line-by-line overview of potential costs. The original RFP
should be transparent on the exact criteria, such as crucial timetable dates or costs
8. Standardised procurement documentation
Identifying the types, forms and models being used for the design would ensure continuity within the
project-related departments, ease the process and promote the continuing process management. A
procurement system integration tool must have the potential to create models that can be used in
acquisition process by individuals around the enterprise and also by third parties.
9. Procurement constraints
Ever since outlined, it manager of city cafe will take into account every time it comes up to
the end of the project. For example, if the timetable is not negotiable, mention anything in this
segment and all employees can recognise that their actions should be determined by an on-time plan
during the procedure. Any other procurement restrictions can be expense, distance, restricted
capital, and technological requirements.
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10. Contract approval process
First include steps leading up to ratification, such as an evaluation of all offers and plans, and also an
overview of operation and costs. Then have the titles, positions and direction the agreements will be
reviewed and accepted by policy makers. Establishing an acceptance process would ensure how each
agreement is examined and accepted in a manner necessary. A contract lifecycle management
framework can have compliance tools to simplify those permissions and promote the agreements.
Contract one:
Particulars Amount ($)
Raw material charges 1200
Labour cost 350
Salary of professions 500
Contractor’s commission 400
Other expense 100
Total 2550
Contract two:
Particulars Amount ($)
Raw material charges 1500
Labour cost 400
Salary of professions 600
Contractor’s commission 300
Other expense 50
Total 2850
Analysis- From above two tables, this can be stated that contract one will be feasible as under
it cost is lower in comparative manner. The difference is expense is because of some activities
like raw material, labour charges and salary of profession as these expenses are higher in
contract two.
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11. Decision criteria
In this phase of the procurement cycle, the review committee will clearly define the requirements used
in determining the provider to grant the service agreement to. For example, in city cafe like the
vendor 's willingness to fulfil the timeline, expense, job or quality of products delivered, vendor's
perceived quality, so each supplier 's commitment to the RFP would likely determine the resulting
decision.
12. Vendor Management
Manager of city café will develop a diagram to ensure that the appropriate goods or services
are provided on time and with the necessary quality standards. This include how frequently the
project team is supposed to meet also with buying department and suppliers, how they interact, the
intent of the meeting, about what each meeting can achieve. These discussions will keep the general
contractor informed of progress of the services and products which are procured.
13. Performance metrics for procurement activities
It is a standard performance metric in city cafe, which can be extended to companies in all
sectors which sizes effectively and consistently. The typical company sees a profit of between 6% and
12% for any dollar under administration. Targeting regions of uncontrolled spending is a crucial
manner in which procurement practitioners can generate value towards their companies and
optimise savings. Here we outlined five ways of reducing unchecked expenses.
14. Performance metrics for procurement activities
To have a good view into the recent state of product creation and execution, the concept of
reviewing and assessing project management practises should be understood. To ensure the current
project remains on track including procurement practises, a collection of measures will be used for
procurement activities assessing. They may be used to compile feedback information from multiple
suppliers, so that the buying department could use this process to determine standards for potential
vendor procurement activities.
15. Sponsor acceptance
Approved by the Project Sponsor:
Project Sponsor:
Procurement Management Plan Template: BSBPMG514 Version: v20.0 Page 7 of 8
Developed by: ACBI Approved by: DoS Issued: July 2019 Review: May 2020

Date:
Signature
Procurement Management Plan Template: BSBPMG514 Version: v20.0 Page 8 of 8
Developed by: ACBI Approved by: DoS Issued: July 2019 Review: May 2020